100k to the first person who finds me saying buying a home is poor money management. I just simply said not everyone has the same goals as him. That some see it a different way ie me. Also i dont have a fam, dont really want one either Once again your exp is not the norm. The average house gains 5% a year last i heard even in this buying home craze which practicly every person in teh industry realizes is on a giant bubble bc of all the low financing that was available in the past 4 years.

 

Thanks Suze Orman.

 

To quote your earlier post, "Minus out property tax and insurance, not to mention interest paid and you have an asset that isnt exactly a money maker."

Sounds like you're insinuating poor money management to me!

I'm just playing, and I understand what you're saying. I guess when you're in a housing market like this one, it's hard to see buying a house as anything other than a must.

Just out of curiosity, how old are you. Based on your statements, I'm going to guess 20 or 21....How'd I do?

 

I bought my house when I was 19 for 164200, selling it august 1st for 280K, total time of ownership 2 years.
Of course i rented the house for only slightly less than it cost me a month, and I lived for next to nothing while going to college.
Owning a home is a B*tch that's for sure. And I'm going to be renting a house after I move out. It all depends on your situation. I'll be using all my cash from thsi house to invest in other real estate ventures while saving my money on cheap rent.

 

but too large & lenghty obligation. So Z & mod came first.
Well , I am not married. Just a g/f & a dog. and decent nestegg.

 

Im 26 and live in the austin tx market. I make plenty of money but ive had to move around alot. It really isnt that good of an investment when compared to the downsides that i spelled out imo. Also I have a pretty good insight into the market since my gf sells houses and her brother is in real estate. I really hope you guys are right but i think your missing the picture. If you wanted to move and sell your house to "reap your rewards" youd have to move to an less-populated/less desireable area bc all the houses in your general viscinity go up right along with yours. The house value you accumulate you will probably never see just like my parents. I asked them hey why dont you move and get something cheaper so it isnt such a burden. They ofcourse love the area and will just grin and bear it. Ofcourse if the house gets left to me i will sell it. I can move my stocks, sell my stocks, and dont have to give them any upkeep besides staying informed. A house to me is a ball and chain. The reason i posted to begin with is i found jet to be totaly missing the whole reason behind modding your car. I also grew up in a rich neighborhood my whole life, people who obsess about money make me go a big rubbery one.

 

I think the point you're missing (in my particular case) is that I'm going to live in something, whether I rent it or own it, so in my case, it is much more beneficial to own the dwelling given the increase in value that we've seen. We will definitely leave this area at some point, so we will see this equity sooner or later. $325K in six years is makes up for a whole lot of downsides (most of which would still exist if I were renting the same property).

Take the equity out of the picture...If I were renting the house (which would somehow do away with the household obligations you speak of) I would not be getting the benefit of the huge tax write-off every year. If I were to rent this house, I'd A) pay more in monthly costs, B) not get a tax write-off, and C) not have the equity potential. If this is a ball and chain, I'll take it.

Again, I think what it comes down to is that it depends on where you live, how you live, and what your goals are. Mine are different than yours, and that's cool...

Peace!!!

 

 

I bought a place 3 years ago to have a decent place to live in. Its my home, where I come to relax and unwind. It has similar sentimental value that my Z has to me.
I havent invested in real estate, because I am not into turning properties for a profit.

I keep up with the economics and have my own opinion how balanced economics work. Housing market is not one of them.

 

I'm not a home owner and unless I ever get married or hit the lottery or my parents die (God forbid), I won't own a home, not at half a million $$$ median.

My mods are going to be in the $5,000 range only.

 

Have any TX guys seen a huge change in the value of your property in the last 10 years? I bought a house because I was getting married. Short of that, I would live at home and really be enjoying my money. Plus as another member pointed out, it may be great that you bought your house for $180K and now it is worth $500K. Guess what, when you go to buy a house, it'll cost you that $500K for the same thing you are living in. I looked at buying a home as a saftey deposit box. It is just some place to put your money...you never really make anything on it but you don't lose either. The price of keeping my house going is what I call the "rent" I pay. If you don't need a house, then don't get one.

 

I bought a 100k house in an up and coming neighborhood and paid it off in 3 years while the value tripled to 300k. I took that 300k and bought a brand new custom house worth 400k that is 5times the size of the first house, which i will pay off in another 3 years...by then the 400k house will be worth 650k. I will sell it and move to a less populated area and have a house that is even larger than the one I am in now. I will buy 12 Z's and mod the hell out of them and waste the other money on strippers.

 

thats funny. Why dont you buy 6 M3's and 6 Z's? Or maybe break it down to Z, M3, C6, G35, couple of sedans for the family?

I live in Texas and yeah the values on houses did go up depending on what area you live in. There are alotttt of houses being built every forest i see eventually it will be cleaned out and houses will come up.

 

What area of Houston do yo ulive in that the prices are coming up. I am in Katy and everyone says that the biggest increases are out here in Katy and I haven't seen a dramatic increase. The only area that you can live in now that went up a lot would be Memorial and only because of the location. No one buys a home in Memorial. They just buy land, tear down the house, and build their own.

 

I am in the sugar land area. Hwy 6 and Voss. I think the most increase is in Sugar Land area because of Town Center in First Colony. I think the 300k homes are now over 400k. I want to move in that area but dont have that kind of money.

 

I just got off the phone with my real estate agent buddy and he says he hasn't seen anything like that. He lives in SL and is having trouble selling his house for what it's worth because of all the new homes in the area. Nobody is getting a premium on their home in Houston area now because of all the new homes. If you want to buy a house I could hook you up with my buddy.

 

I have made this arguments to a couple of my friends so I will put this in writing and see what you guys think or can pick at.

-This situation is for someone making about 60 grand a year before taxes.
-A person who is 25 - 30 who is not married and would buy a hose for investment to sell in 5 years
-The monthly wages after taxes is 3000, while the house expense is 2000 (rounded off to make this easier)
-This person does not have any roommates for more income.

Path 1: Owning a house and buying a Z:
$3000 a month take home after taxes
$2000 in expenses(this include mortgage, property tax, utilities, groceries, etc.)
That leaves you with $1000 play money for the whole month and that is $24,000 a year going into the house.
That leaves you with 12,000 play money for the whole year, but let's just say you use 6,000 for eating out, gifts, emergency things for the house, fun, etc. for the whole year and invest the other 6,000 in the house. you will have put in $30,000 in (You must remember that 30,000 is not all going into the equity of the house, that 30,000 is what you have to dish out for "having" a home) And as you know, the first few years is paying off the massive interest in the house (the first year, I only payed off 1,500 of the price of the house, the rest of the mortgage payment went into paying the massive interest)

So in five years, you would have put in $150,000 into "having" a house. And if you were good and didn't go on vacations and stuff like that, you could have put about 30,000 (the other half of the play money x 5 years). Then let's just say you sold the house and made $50,000 profit(I choose 50,000 because I didn't want to go with extremes of a very low profit to a really lucky high profit)


Path 2: Renting a house with your friends (or finding shared accommodations) and buying a Z:
$500 rent (shared accommodation)
$200 food
That leaves you $2300 to play with and save up if you want to. That's $27,600 a year you can potential save if you wanted to. But of course it will be around 20,000 because 7,600 will go into play money and such.

So each year, you can potential save 20,000... in five year you could make more then 100,000 in profit or even more if you put it into a GIC or some safe government investment, then you can make a $100,000 down payment. With that big of a down payment, your first few years, would be payed more into the cost of the house then the huge interest.

So... 80,000 or 100,000...

Don't know, there are lots of factors. I just put what I was thinking.

Please correct anything I've missed.

 

I am a house owner and have a completely stock Z.... enough said

 

in the housing market I am in, you would have to save more than $20k a year just to keep up with the increasee in housing prices. So essentially you are not saving anything, you are just prolonging the inevetiable.

 

I tried to find the medium, not everyone lives or wants to live in a housing area where the houses are $300k or $400k. I would never buy that kind of house for investment unless I was married and had a partner to bring in more money.

Not every area increases by so much. My neighbourhood is right beside a park with a basebalkl diamond, tennis court, hockey ring in the winter time. The park is right beside a school that also has a huge field with track & field tracks for running. The neighbourhood doesn't have a through street so hardly any traffic. It's far away from the highway so that there is no noise and you can't see it, but close enough that it only takes 2 minutes to get on the highway.

I did all my research on this area and only found out that after two years, it has only gone up $20,000.

I think it is all about luck too, my friend bought a place in the middle of nowhere and suddenly they decide to do some new housing developement near him and suddenly, his house shot up in the market by $50,000.

The housing market can be very tricky.